loma campana shale hits stride in Argentina

March 18, 2015 – The Loma Campana project, operated by partner YPF S.A., is making impressive progress as the first development project in Argentina's Vaca Muerta formation, one of the biggest shale plays in the world. Since January 2014, production has doubled, and Loma Campana has become the second-largest oil producer in Argentina.

Loma Campana supports Chevron's production growth target of 3.1 million barrels of oil-equivalent per day in 2017. The project area has an estimated recoverable resource of 1 billion barrels of oil-equivalent and is currently producing quality feedstock for refineries in Argentina.

"Loma Campana's production is demonstrating solid growth and has doubled from where we started the year in 2014," said Kelly Hartshorn, Chevron's Latin America business unit managing director. "This performance sets us on a firm path for building a material unconventional business in Argentina, and reflects a clear sense of teamwork with a commitment to safe operations by both Chevron and YPF."

Chevron, through a subsidiary, joined the Loma Campana project as a financial stakeholder in 2013. During 2014, 166 wells were drilled. At the end of 2014, a total of 290 wells were tied into production facilities with net daily production of 7,000 barrels of crude oil and 17 million cubic feet of natural gas. To achieve that plan, the project team is drawing on shale development experience gained in Chevron's Appalachian/Michigan and Mid-Continent operations. Conventional rigs are disassembled to move from one well to the next. The Loma Campana team uses rigs that "walk" from well to well on skids. These rigs drill up to eight wells on one well pad.

"These rigs are complex, but give us the ability to decrease the number of days it takes to move a rig and enable us to do batch drilling, which reduces time and costs," explained Rick Parrish, Drilling and Completions Operational Excellence (OE) manager.

Chevron subsidiary General Manager Kevin Maneffa credits YPF for forging the path at Loma Campana after drilling 120 wells during a pilot phase in 2012 and 2013.

"YPF has very good employees. They've done a good job of bringing in the rigs and support services," said Maneffa. "The lessons learned from the pilot wells are enabling us to standardize operations and drive costs down, which is key to shale development."

"This project is an opportunity to develop a tremendous resource and help Argentina become energy self-sufficient," added Maneffa. "But equally valuable are the lessons we're learning in unconventional resource development."

Updated: March 2015